This
opinion will be unpublished and
may not be cited except as provided by
Minn. Stat. § 480A.08, subd. 3 (2004).
STATE
OF MINNESOTA
IN COURT OF APPEALS
A04-2005
Doug Gunderson,
Plaintiff and Counterclaim Defendant,
Respondent,
vs.
Roy C. Gunderson,
Defendant, Counterclaimant, Cross-Claimant and Third-Party Plaintiff,
Ann K. Gunderson,
Defendant, Counterclaimant, Cross-Claimant and Third-Party Plaintiff,
Appellant,
and
Brian J. Gunderson,
Defendant and
Cross-Claim Defendant,
Respondent,
and
Stanton Gunderson, et al.,
Third-Party
Defendants,
Respondents.
Filed June 21, 2005
Affirmed
Poritsky, Judge
Itasca County
District Court
File No. C5031151
John P. Dimich, Dimich, Swanson
& Sterle, 102 Northeast Third Street, Suite 120, Grand Rapids, MN 55744
(for respondent Doug Gunderson)
Steven K. Marden, 2136 Ford Parkway, Suite 359, St. Paul, MN 55116 (for appellant)
Charles H. Andresen, Andresen
& Butterworth, P.A., 1000 Alworth Building, 306 West Superior Street,
Duluth, MN 55802 (for respondents Stanton Gunderson and Mary Johnson)
Considered and decided by
Schumacher, Presiding Judge; Wright, Judge; and Poritsky, Judge.
U N P U B L I S H E D O P I N I O N
PORITSKY, Judge
Appellant challenges the district
court’s denial of her claims seeking to invalidate deeds that conveyed property
to four of her children and retained a life estate for her and her husband, who
has since passed away. She argues that
the deeds are void due to (1) fraud, (2) undue influence, and (3) lack of
delivery. Because we conclude that the
district court did not err when it determined that (1) the deeds were not the
product of fraud, (2) the deeds were not the product of undue influence, and (3)
appellant has not presented sufficient evidence showing lack of delivery, we
affirm. We also affirm the district
court’s holding that an earlier determination of an easement will not be
modified.
FACTS
Appellant Ann Gunderson and her husband Roy Gunderson, who died in
December 2003, lived together on a piece of property in Grand Rapids, Minnesota,
for more than 20 years. Ann and Roy
Gunderson had seven children: Mary Johnson, Brian Gunderson, Stanton Gunderson,
Douglas Gunderson, Larry Gunderson, Richard Gunderson, and Michael
Gunderson. During the 1990s, Ann and Roy
consulted with Douglas about financial matters
including their investments. Douglas and
Ann stipulate that Douglas was in a fiduciary
relationship with Ann and Roy at the time the deeds at issue were drafted,
signed, and recorded.
Douglas testified that his parents “wanted to get all
their affairs in order.” According to Douglas, he went with his parents to see attorney Warren Anderson,
whom his parents had used previously for a land sale, and they discussed the
effect of deeds conveying their property to four of their children, while
retaining a life estate. The
irreversibility of this action was discussed.
Douglas testified that Anderson
told him that to avoid taxes the property would be conveyed over multiple
years. Douglas further testified that he
was not with his parents later when they returned to meet with Anderson and signed the deeds. Copies of the signed deeds were then sent to
Douglas, who testified that he recorded one of the deeds and the Anderson’s firm recorded
the other two.
Ann
and Roy Gunderson signed the following four deeds conveying portions of their
property to Mary Johnson, Brian Gunderson, Stanton Gunderson, and Douglas
Gunderson; the deeds retained a life estate for Ann and Roy: (1) a deed dated
Saturday, December 28, 1996, and recorded June 23, 1997; (2) a deed dated
Monday, January 5, 1997 (this deed contained an error and was replaced by
another deed that was signed the same day); (3) a second deed dated Sunday,
January 5, 1997, and recorded June 23, 1997; (4) a deed dated Monday, January
5, 1998, and recorded January 23, 1998. Anderson prepared all of
these deeds.
Ann testified that she did not understand what
the documents were when she signed them and that Roy never asked any questions about the deeds. Ann also testified that she signed the
documents because she trusted Douglas and thought he was looking out for her
and Roy’s best
interests. She testified that she
trusted her husband and he knew more about these types of things, so that if he
told her to sign she would have. Roy gave a deposition, which was admitted at trial, and in
his deposition, Roy
testified that nobody exerted any influence over him to sign the deeds and that
he signed them of his own free will. Roy further testified
that he did not read over the documents before signing them. Although he did not remember much about the
transaction, Roy stated that he asked questions
of Anderson and that Anderson answered them. Roy
also stated that he understood that his conveyance to his children was forever,
but that he thought it might be possible to change his mind.
After
signing the deeds, Ann and Roy Gunderson told some of their children that they
were satisfied with their actions. Mary
Johnson testified that Ann told her that it was Ann’s understanding that Ann
and Roy could stay on the property until they died and then it transferred. Ann expressed that she was happy that they no
longer had to worry about what was going to happen to the farm. Stanton Gunderson testified that Ann told him
that she had set up a life estate and was happy that this burden had been taken
care of. He also testified that his
father, Roy, was also happy with what they had done.
Three of the children, Larry, Michael, and
Richard Gunderson, were not included in the deeds signed by Ann and Roy Gunderson. When Roy
was asked in his deposition if there were reasons why the three children were excluded,
he answered, “Right.” The matter was not
pursued further with Roy,
butAnn testified that Larry was not on the deeds because he was having
financial trouble and there was a fear his creditors might come after his
interest. She also stated that Michael
had debts, and in response to a question regarding whether a fear existed that they
might become an encumbrance on the property, she stated his life was unsettled
at the time. Mary Johnson testified that
Richard was probably not included in the deeds because he and Roy had a
business partnership that ended in bitterness.
The
district court made extensive findings of fact and accompanied them with a
well-reasoned opinion. The court found that Ann’s testimony was not
“particularly credible,” and the court did “not place great weight” on Roy’s testimony that he
did not read the documents before signing them.
The court also specifically found that the deeds were not all signed on
the date that Douglas Gunderson went with his parents to see Anderson.
The court concluded that it had not been established that there was any
fraud, undue influence, or misrepresentation involved in the deeds conveying
property from Ann and Roy Gunderson to their children. The court also concluded that it was irrelevant
whether the deeds were signed on the dates shown on the deeds because the deeds
were effective when delivered. The court
also held there was no basis for modifying the easement from what had been
determined in an earlier decision of a district court. Ann Gunderson appealed the ruling that the
deeds should not be set aside.
D E C I S I O N
I.
On appeal from a trial where the judge is the
factfinder, the findings of fact “shall not be set aside unless clearly
erroneous, and due regard shall be given to the opportunity of the trial court
to judge the credibility of the witnesses.”
Minn. R. Civ. P. 52.01; Norlander v.
Cronk, 300 Minn. 471, 474, 221 N.W.2d 108,
111 (1974); Werner v. Miller, 248 Minn.
75, 79, 78 N.W.2d 63, 66 (1956).
A. Undue
Influence
Ann
claims that the deeds from her and Roy were not valid because her son Douglas
exerted undue influence over them to make these conveyances.
The burden for proving undue influence lies
with the party asserting it. Norlander, 300 Minn. at 475, 221 N.W.2d at 111-12. Undue influence exists if the influence
is such as to overcome the free will of the individual. Id.
at 475, 221 N.W.2d at 111. It must be
established not only that the influence was exerted, but that dominance and
control of the grantor’s mind was such that he or she “became a mere puppet of
the wielder of that influence.” In re
Estate of Congdon, 309 N.W.2d 261, 268 (Minn. 1981).
The question of whether undue influence exists is a question of fact and
is for the factfinder to determine, unless the evidence is conclusive one way
or the other. Agner v. Bourn, 281
Minn. 385,
393, 161 N.W.2d 813, 819 (1968). “Where
confidential relations exist between parties and one of them uses the
relationship to secure an inequitable advantage, equity will set aside the
transaction.” Id.at 390, 161 N.W.2d at 817. However, even when a confidential
relationship exists, there still must be evidence that undue influence was in
fact exerted. Id. at 392, 161 N.W.2d at 818. It is possible to infer undue influence when
there is a disposition of property in favor of the one who had an opportunity
to influence, while other natural recipients are ignored. Id. To determine if a grantor’s free will has
been overcome, courts will consider the grantor’s age, intelligence,
experience, physical and mental health, and strength of character. Id.
The
district court did not give credibility to Roy
and Ann’s testimony that they signed the deeds without reading them or to Ann’s
testimony that she signed the documents because she believed that Douglas was looking out for their best interests. Even accepting their testimony as true, there
is no real evidence that Douglas exerted any
undue influence. Roy stated that no one exerted any influence
over him to sign the documents and that he signed them of his own free will. The district court specifically found that Douglas
did not accompany his parents to meet with Anderson when they actually signed the
deeds. The most that Ann and Roy’s testimony
shows is that they did not entirely understand what they were signing, not that
Douglas Gunderson exerted any influence over them to sign the deeds. In addition, there is testimony that Ann and
Roy told their children that they were happy with their actions and understood
what they had done. Although not all of
the children were grantees, three children (other than Douglas)
who were grantees had nothing to do with the execution of the deeds. Ann and Roy testified that there were reasons why
three of the children were not grantees.
Under these circumstances the district court’s finding that Douglas did not exert undue influence is not clearly
erroneous.
B. Fraud
Ann claims that the deeds are void because of
fraud. The party asserting fraud has the
burden of proof. See State by Humphrey v. Alpine
Air Prods., Inc., 500 N.W.2d 788, 790-91 (Minn. 1993).
A party must show the following to establish a claim for fraud:
(1) A false representation of a material past or present fact susceptible
of knowledge;
(2) The defendant either knew it to be false or asserted it as his own
knowledge without knowing whether it is true or false;
(3) The defendant intended the plaintiff to act on his representation;
(4) The plaintiff was induced to act in reliance on the representation;
and
(5) The plaintiff suffered damages which were the proximate cause of the
representation.
Rognlien
v. Carter, 443 N.W.2d 217, 220
(Minn. App. 1989), review denied (Minn. Sept. 21, 1989); see Heidbreder v. Carton, 645 N.W.2d 355, 367 (Minn. 2002).
Appellant claims that the evidence that all
of the deeds may have been signed on the same date, even though three different
dates appear on the deeds, is evidence of fraud by Douglas. Douglas testified that attorney Anderson believed that to
avoid certain taxes the property should be conveyed over several years. This gives a plausible explanation for the
possibility that the dates on the deeds do not correspond to the dates when the
deeds were signed. There is no claim or evidence that Ann or Roy
did not sign the deeds or that there was a misrepresentation about what the
deeds stated. Douglas
was not present when Ann and Roy signed the deeds. Even if the dates on the deeds were
incorrect, this is not evidence that Douglas made a material false
representation to Roy or Ann, or that Roy or Ann were induced to rely on any
such representation.
Finally, Ann argues that her interests
are separate from Roy’s
and that his knowledge cannot be imputed to her. Although it is not clear, she apparently
makes this argument in support of her claims of undue influence and fraud. While it is true that Roy’s knowledge cannot be imputed to Ann, nonetheless
she testified that she signed the deeds because her husband told her to and she
always trusted her husband. So even if Ann
relied on her husband and did not understand exactly the effect of the deeds
she was signing, this does not demonstrate any type of undue influence or fraud
on Douglas’s part.
C. Delivery